Farm Finance – tax tips for the rural economy

At Farm and Country Finance, we like to pass on a bit of food for thought. As the economy recovers, here are a few tax insights to give you some ideas to think about and to talk to your accountant about.

1. Panic early – do not leave long term tax planning until it is too late; consult the family and take action.

2. Think about any changes that you could make now that might help to protect your business against any detrimental changes to fiscal policy arising out of the 2015 general election.

3. From April 2014 new allowances for investment in plant, machinery and equipment were introduced for a limited window only, £500,000 being the new maximum until 31 December 2015 when the limit reduces to just £25,000. Care needs to be taken with financial years that straddle the start and finish dates for the scheme. A programme for this year and next year should be planned now to take advantage of the scheme.

4. Have a look at business performance for this year to determine whether the second instalment of income tax due on 31st July still applies. Will your tax liability for 2013/14 be lower than for 2012/13?

5. The new ISA rules introduced a higher annual investment limit for 2014/15 of £15,000 from July 2014. You may wish to take advantage of this.

6. Where appropriate, make sure you have claimed the £2,000 (NIC) employment allowance.

7. Be prepared for Pensions Auto-enrolment. As staging dates for employers with smaller numbers of employees approach so the system is likely to become clogged. Starting the registration process sooner, as well as budgeting for the additional workload for both setting up and running your scheme, could help to avoid the hassle.

8. If you are considering diversification could the Enterprise Investment Scheme (EIS) or Seed EIS help?

9. In view of new anti-avoidance legislation, consider a review of partnership structures that have corporate members to ensure that these are within the law.

10. Review potential Inheritance Tax reliefs to ensure that they have not been compromised by new activities or ventures.